Commissioner Clashes With Covered California Over Specialty Drugs

Commissioner Clashes With Covered California Over Specialty Drugs
Insurance Commissioner Dave Jones has come out against a specialty drug proposal by Covered California. Under the Covered California plan, Californians would have to pay up to $500 per month per prescription for specialty drugs needed to treat chronic illnesses; that’s in addition to their monthly insurance premiums.

Jones and consumer groups say that the proposal will require many Californians with chronic illness, such as MS, Rheumatoid Arthritis, and HIV/AIDS, to pay thousands of dollars in the first few months of their health insurance policy year to get life-sustaining drugs. The commissioner and consumer groups urged that Covered California adopt a much lower $200 monthly cap for these specialty drugs, as other states have done.

“Covered California’s specialty drug proposal is a potentially discriminatory benefit plan design that would propel vital, life-sustaining drugs out of reach for many Californians. This plan creates an insurmountable affordability barrier for the average consumer, particularly those who struggle with chronic and life-threatening conditions that require multiple prescriptions,” said Jones.

Californians with chronic illnesses often take multiple drugs, which means that they could have to pay a minimum of $1,000 a month out-of-pocket even though they have health insurance. The commissioner was joined by consumer and patient advocates from California Chronic Care Coalition and Project Inform, who described the negative financial and health impact Covered California’s plan will have on patients who need these drugs.

The commissioner noted that insurance code sections 10965.5(a)(3) and 10753.05(h)(3) prohibit practices or benefit designs that discourage consumers with significant health needs or conditions from enrolling in health insurance products with Covered California’s standard benefit design. Over the past two years, the Department of Insurance has rejected some plan designs with co-insurance requirements on specialty drugs because of their discriminatory impact on those with certain medical conditions.

Anne Donnelly, Director of Health Care Policy at Project Inform said, “The caps being recommended by Covered California staff are welcome but they do not go far enough; $500 per prescription per month for most of those in Covered California plans will mean that many with chronic conditions will be forced to exhaust limited savings or forego necessary health care.”

Last Updated 09/12/2019

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